C-114/83

(Act ofAccession of the Hellenic Republic, Art. 130 (2))

In Case 114/83

SOCIÉTÉ D'INITIATIVES ET DE COOPÉRATION AGRICOLES, an agricultural cooperative, Kerisnel, Saint-Pol-de-Léon,

and

1 — Language of the Case: French.

JUDGMENT OF 5. 7. 1984 — CASE 114/83

Advocate General : Sir Gordon Slynn Registrar: P. Heim

gives the following

STÉ. D-INITIATIVES ET DE COOPÉRATION AGRICOLES » COMMISSION

JUDGMENT

Facts and Issues

The facts of the case, the course of the Government expressed its wish that the procedure and the conclusions, sub- Commission should take the measures missions and arguments of the parties necessary to remedy the situation as soon may be summarized as follows: as possible.

On 5 April 1983 the applicants, considering that Greek exporters were An application for the adoption of going to dump products on the interim measures lodged on 1 July 1983 Community markets in the 1983 was dismissed by the President of the marketing year as well, asked the Court by order of 12 July 1983. Commission to take such action as might be necessary to prevent entirely any repetition or the discriminatory practices complained ofin 1981 and 1982. In their reply, lodged on 2 September 1983, the applicants stated that they discontinued their action in so far as it was based on Article 175 of the EEC By telex message of 22 April 1983 the Treaty and limited their claims to the Commission replied that it was studying Community's liability under Article 215 the problem closely and that it would not of the EEC Treaty arising from the fail to take the appropriate action. Commission's unlawful inaction and breach of the principle of equality. On 2 June 1983 the applicants notified the Commission that the prices of new An application to intervene by the potatoes on the German, United Groupement des Associations Agricoles Kingdom and French markets were pour l'Organisation de la Production et dropping as a result of imports of Greek de la Commercialisation des Pommes de potatoes which, in their opinion, were Terre et Légumes de la Région Malouine subsidized by the Greek Government. (GAARM) and by 24 other trade On the same day, the French associations and groups seeking to

JUDGMENT OF 5. 7. 1984 — CASE 114/83

intervene in these proceedings as parties Reserve to the applicants the right to fix, in their own right ("à titre principal") after the expert's report has been was dismissed by the Court by order of received by the Court, the final amount 19 October 1983. of compensation due to them;

Admissibility of the application The applicants claim that the Court should: The Commission submits that the application is inadmissible on the ground Declare and decide that, by failing to act that at least one of the applicants, upon the applicants' request dated 5 Société Interprofessionnelle des Pro- April 1983, alternatively upon the ducteurs et Expéditeurs de Fruits, repetition of that request dated 2 June Légumes, Bulbes et Fleurs d-Ille-et- 1983, and by failing to take the Vilaine, has no interest in bringing an necessary steps to terminate the illegal action. That party does not appear to be practices of which it had been notified, classifiable as a producer, but rather its the Commission has infringed the Treaty role is to defend the general interests of of 25 March 1957 and the measures trade groups which are not strictly giving effect to it; confined to producers of potatoes. Declare and decide that the Community Likewise, in the case of Société is liable to the applicants, by virtue of the d'Initiatives et de Coopération Agricoles second paragraph of Article 215 of the de Kerisnel, the Commission considers it Treaty of Rome, for the wrongful failure necessary to verify whether it actually of the Commission to act; constitutes a producers' cooperative.

Order the Community to make a The' applicants state in reply that, as is payment on account to the applicants of apparent from the instruments con- FF 500 000; stituting and regulating them, they represent potato growers and are Appoint such expert as the Court of specifically concerned with the mar- Justice may decide to quantify the keting of vegetables, in the first place by damage suffered by the applicants from taking action directly and in the second an accounting, commercial and financial by means of management measures. point of view after making all necessary They therefore consider their ap- inquiries; plications to be perfectly admissible.

The power to determine, even on the In the opinion of the applicants, the Commission's own initiative, pursuant to Commission, although well aware of Article 2 (3) of Regulation No 26/62 those infringements, wrongly failed to applying certain rules of competition to take any action, although it had the production of and trade in agricultural means to enforce the Treaty of Rome products, whether certain agreements, and the Act of Accession. decisions and practices are excluded from the scope of Article 85 (1) of the EEC Treaty by virtue of Article 2 (1) of Among such means of action, the that regulation; applicants list the following:

The adoption of decisions pursuant to The adoption of protective measures Article 93 (1) of the EEC Treaty to under Article 130 of the Act of compel a Member State to abolish or Accession. In that connection the alter any aid incompatible with the applicants state that all the conditions common market; required for the adoption of a protective measure were satisfied: the volume of Greek imports was very high and in The adoption of decisions under Article Great Britain during the second half of 46 of the EEC Treaty in order to re-

JUDGMENT OF 5. 7. 1984 — CASE 114/83

It has, they maintain, been proved that the availability of Greek potatoes at extremely low prices as a result of the As regards the first point, it considers in State subsidies led to as a drop in prices detail the provisions relied upon by the on the United Kingdom, German and applicants.

STÉ. D'INITIATIVES ET DE COOPÉRATION AGRICOLES v COMMISSION

As regards failure to adopt protective an application to the Commission under measures under Article 130 of the Act of that article. As regards Article 2 (3) of Accession, the Commission considers Regulation No 26/62, the Commission that there was no "serious disturbance" considers that provision to refer only to of the market such as to justify either the the procedures for applying paragraph introduction of a countervailing charge (2) of that article, which, in turn, serves or suspension of the contested exports. merely to confine the scope of Article 85 (1) to production of and trade in It states in particular: agricultural products. No obligation incumbent upon the Commission to terminate the practices complained of That Greek new potatoes account for can therefore be inferred from that only about 5 % of total imports into provision. Member States of the Community and 10% of intra-Community trade; As regards Article 93 (2), the Com- That the prices of Greek potatoes are mission points out that Regulation No not in general lower than those of 26/62 does not provide for the potatoes of the same quality produced in application of that provision to the agri- the other Member States; cultural sector. Moreover, even if that provision were applicable at least to In 1983, stocks of ware potatoes were products not covered by a common still copious even at the end of June and organization of the market, it should be the fact that they were much cheaper pointed out that by order of 11 July than new potatoes and that the weather 1979 in Case 59/79 the Court dismissed was rather cold encouraged consumption as inadmissible an application regarding of ware potatoes to the detriment of new the Commission's failure to declare potatoes, so that the prices of new certain aid to be incompatible with potatoes fell. Article 92.

of the EEC Treaty, which is equivalent resulting from loss of expected profit or to Article 130 of the Act of Accession of commercial risks in general. Greece. According to the Commission, there is According to the decisions of the Court, nothing special about the damage and it the exercise of such discretion renders does not seem to be direct damage in so the Community liable only if there is a far as the applicants contributed to it by sufficiently serious infringement of a immediately harvesting the new potatoes superior rule of law for the protection rather than marketing them as ware of individuals. According to the potatoes at a later stage. Commission, the applicants have not claimed that any general principle of Finally, the Commission contends that it Community law has been infringed nor has not been demonstrated that the have they proved that the alleged prices of the Greek products were infringement derives from a substantive responsible for the drop in prices on the or manifest error on the part of the principal markets of destination; the true Commission. cause of the crisis lies in the size of the ware potato stocks and in the fact that The Commission denies that any damage supplies from many different sources was actually suffered since, in its were simultaneously available in June opinion, there was nothing exceptional 1983. about the price variations recorded in 1983. Those variations are a factor which growers of a product which is so sensitive to market conditions, in IV — Oral procedure particular climatic conditions, should take into account in their planning, in The parties presented oral argument at the absence of a common organization the sitting on 15 March 1984. of the market. The Commission cannot guarantee price stability on the new- potato market and is therefore under no The Advocate General delivered his obligation to make good any damage opinion at the sitting on 12 April 1984.

4 It is not, however, apparent from the applicant's conclusions that they purport to act in the capacity of growers nor is it possible to infer that capacity from the instruments constituting and regulating them, which were produced to the Court. Moreover, at the hearing, they stated that they were growers' associations which received, and became the owners of, produce contributed by the growers and sold that produce on the wholesale markets.

s In those circumstances, it cannot be denied that the applicants are entitled to bring an action for damages, in so far as the action is based on the loss suffered by them in their capacity of dealers in new potatoes.

6 The submissions put forward by the applicants in support of their application relate in the first place to the allegation that the Commission infringed Community law by failing, despite massive imports of Greek new potatoes benefiting from State export aid, to adopt measures to neutralize the adverse consequences of that situation.

7 The measures which, according to the applicants, the Commission should have adopted include, in the first place, a protective measure within the meaning of Article 130 (2) of the Act of Accession of the Hellenic Republic

JUDGMENT OF 5. 7. 1984 — CASE 114/83

to the European Economic Community. The third subparagraph of that article provides as follows:

n In that connection, the Commission did not consider that, either by reason of their quantity or their price-level, the potatoes from Greece disturbed or were likely to disturb the United Kingdom market seriously. At the hearing, it contended that the true reasons for the- fall in prices on the United Kingdom market were the existence of very large stocks of ware potatoes

STÉ. D'INITIATIVES ET DE COOPÉRATION AGRICOLES v COMMISSION

and the fact that supplies were simultaneously available from various sources for a very short period. It is necessary therefore to establish whether, on the basis of the information in its possession on 20'June 1983, the Commission was justified in not adopting the measures in question.

12 It must in the first place be pointed out that since a very large quantity of ware potatoes was produced in the autumn of 1982, large stocks of ware potatoes existed at the beginning of the marketing season for new potatoes, as is proved by the fact that, according to the statistics from the United Kingdom Ministry of Agriculture produced by the Commission, the remaining stocks of ware potatoes still amounted to 60 000 tonnes on 22 June 1983, whereas on 22 June 1982 they had amounted to only 30 000 tonnes.

is The existence of large stocks of ware potatoes, whose price is normally one- third of that of new potatoes, must inevitably exert considerable influence on the prices of new potatoes. In fact, it is apparent from the abovementioned statistics that as early as the start of the 1983 marketing year, that is to say well before the arrival of the Greek potatoes on the market, the prices of new potatoes were lower than the prices at the start of the 1982 season. Moreover, there is a fall of prices each year on the United Kingdom market in June as a wholly normal consequence of the simultaneous availability during that period of supplies originating from various places (Cyprus, Greece, Spain, France, Jersey and Turkey).

is Those assessments are based on findings of fact which are correct. It is apparent from the Potato Marketing Board statistics that Greek imports into the United Kingdom between 1 June and 11 June 1983 accounted for 220 tonnes out of a total of 34 675 tonnes sold on the United Kingdom market and, between 11 and 17 June, for 3 754 tonnes out of a total of 35 302 tonnes. It was only in the week from 18 to 24 June that they reached the level of 10 402 tonnes out of a total of 42 516 tonnes.

i6 In the light of those figures, the Commission was justified in concluding that, even if their price was below that of competing products, the Greek potatoes, by reason of their small quantities, could not have given rise to a general downward movement during the period preceding the request for protective measures. Nor is there any basis for taking the view, as the applicants do, that the announcement that large quantities of Greek potatoes were expected to arrive after 17 June 1983 could have upset prices as from 7 June 1983.

i7 The question now to be considered is whether it was reasonable for the Commission to take the view that the considerable quantities of Greek potatoes to be imported after 20 June 1983 would not seriously disturb the United Kingdom market.

,8 It must be stated in that connection that, on the basis of the experience acquired in the preceding years, the Commission was able to foresee that, even if about 30 000 tonnes of Greek potatoes had not been imported, the market demand, which in 1981 and 1982 had stabilized at about 90 000 tonnes in June, would have led to their place being taken by potatoes from elsewhere and the market situation would not thereby have been significantly affected.

23 T h e Commission also stated at the hearing that it did not remain inactive w h e n the applicants asserted that agreements existed which were c o n t r a r y to the competition rules of the T r e a t y but in fact sent an inspector to Greece w h o , however, found n o trace of the existence of any agreements between undertakings dealing in n e w potatoes.

24 In those circumstances, the Commission cannot be criticized for failing to adopt any decision under Article 3 of Regulation No 17/62.

JUDGMENT OF 5. 7. 1984 — CASE 114/83

25 Nor is it pertinent to refer to Article 131 of the Act of Accession, under which the Commission has the power, "before the expiry of the period ol application of the transitional measures laid down under this Act lor each case", to address recommendations, upon application by a Member btate or any other interested party, to the person or persons responsible lor dumping for the purpose of putting an end to that practice. Since no transitional measure was laid down for new potatoes, it must be considered that the normal rules of the Treaty are to apply to that product.

26 According to the applicants, the Commission could also have decided under Article 93 (2) of the EEC Treaty that Greece was to abolish the aid lor the export of potatoes.

27 There is no need to give any decision as to the actual existence of such aid, it being sufficient to point out with regard to that argument that under Article 42 of the EEC Treaty "The provisions of the Chapter relating to rules on competition shall apply to production of and trade in agricultural products only to the extent determined by the Council" and that Article 4 of Council Regulation No 26/62, which declares Article 93 (1) and (3) to be applicable ito agricultural products, does not declare applicable Article 92, which prohibits State aid, or Article 93 (2), which confers upon the Commission power to decide that a Member State must abolish or alter such aid. bince potatoes are not subject to a common organization of the market, the provisions of Article 4, mentioned above, are so far the only provisions applicable to them.

32 Under Article 69 (2) of the Rules of Procedure the unsuccessful party must be ordered to pay the costs, if .they are asked for in the successful party's pleadings. Since the applicants have been unsuccessful in their submissions, they must be ordered to pay the costs, including those of the proceedings for the adoption of interim measures.

On those grounds,

T H E C O U R T (First Chamber)

hereby:

1. Dismisses the application;

2. Orders the applicants to pay the costs, including those of the proceedings relating to the application for interim measures.